Artistic Denim Mills : TRANSMISSION OF HALY YEARLY REPORT FOR THE PERIOD ENDED DECEMBER 31, 2022

HALF YEARLY REPORT

DECEMBER 31, 2022

CONTENTS
COMPANY INFORMATION	1
DIRECTORS' REVIEW REPORT TO THE MEMBERS	2
INDEPENDENT AUDITORS' REVIEW REPORT TO THE MEMBERS	4
CONDENSED INTERIM STATEMENT OF FINANCIAL POSITION	5
CONDENSED INTERIM STATEMENT OF PROFIT OR LOSS	6
CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME	7
CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY	8
CONDENSED INTERIM STATEMENT OF CASH FLOWS	9
NOTES TO THE CONDENSED INTERIM FINANCIAL STATEMENTS	10

ARTISTIC DENIM MILLS LIMITED

	HALF YEARLY REPORT
	DECEMBER 31, 2022
COMPANY INFORMATION
Board of Directors
Chief Executive	Mr. Muhammad Faisal Ahmed
Chairman	Mr. Muhammad Iqbal Ahmed
Directors	Mr. Muhammad Yousuf Ahmed
	Mr. Muhammad Ali Ahmed
	Ms. Zahra Faisal Ahmed
	Mr. Yazdani Zia
	Mr. Muneer Ahmed
Audit Committee
Chairman	Mr. Yazdani Zia
Members	Mr. Muhammad Iqbal Ahmed
	Mr. Muhammad Ali Ahmed
Human Resource and
Remuneration Committee
Chairman	Mr. Yazdani Zia
Members	Mr. Muhammad Faisal Ahmed
	Ms. Zahra Faisal Ahmed
Chief Financial Officer	Mr. Sagheer Ahmed
Company Secretary	Mr. Muhammad Ozair Qureshi
Chief Internal Auditor	Mr. Salman Arif
Auditors	M/s. Reanda Haroon Zakaria & Company
	Chartered Accountants
Legal Advisor	Monawwer Ghani
	Advocate
Share Registrar	M/s F.D. Registrar Services (SMC Pvt.) Limited
	17th Floor, Saima Trade Tower-A,
	I.I. Chundrigar Road, Karachi.
	Tel: [phone]
Bankers	Allied Bank Limited
	Bank Al Habib Limited
	BankIslami Pakistan Limited
	Faysal Bank Limited
	Habib Bank Limited
	Habib Metropolitan Bank Limited
	Meezan Bank Limited
	National Bank of Pakistan
	Standard Chartered Bank (Pakistan) Limited
	United Bank Limited
	Woori Bank
Registered Office	Plot No. 5-9,23-26, Sector 16,
and Factory	Korangi Industrial Area, Karachi.
	UAN: 111 236 236, Fax No. 3505 4652
	www.admdenim.com
ARTISTIC DENIM MILLS LIMITED	01

HALF YEARLY REPORT

DECEMBER 31, 2022

DIRECTORS' REVIEW

On behalf of the Board of Directors, we are pleased to present to the shareholders the Directors' Review Report of your Company together with the un-audited condensed interim financial statements for the half year ended December 31, 2022.

PERIOD UNDER REVIEW

Following is the gist of the Company's performance for the period under review as compared with the corresponding period last year:

	December 31, 2022	December 31, 2021
	Rs. in ('000')	Rs. in ('000')
Sales without exchange gain	7,011,239	7,859,581
Exchange gain	480,653	100,991
Sales - net	7,491,892	7,960,572
Gross profit	1,242,062	753,608
Finance costs	363,178	179,384
Net profit	465,764	242,179
EPS (Rs. per share)	5.54	2.88

Despite substantial macro-economic challenges, your Company achieved net sales of Rs.7,492 million as compared to Rs.7,961 million in the same period of last year, down 5.89%. The decrease in sales was primarily due to global inflation and recession, therefore, slowdown in demand in the international market.

The Company posted a gross profit of Rs. 1,242 million for the half year under review as compared to Rs. 754 million for the corresponding period of last year, up 64.82%, on account of devaluation of Pakistan Rupee and effective cost controls.

Finance costs for the period under review increased to Rs. 363 million as compared to Rs. 179 million for the corresponding period of last year, which was the combined impact of higher effective interest rates and working capital needs.

After providing Rs.92 million for taxation, the Company has been able to achieve a net profit of Rs. 466 million as compared to a net profit of Rs. 242 million during the same period last year, reflecting a remarkable increase in profit, up 92.32%. This resulted in Earnings per Share (EPS) of Rs. 5.54 as compared to Rs. 2.88 for the corresponding period of last year.

FUTURE OUTLOOK

We expect Pakistan's textile exports to remain muted in the coming months amid inflationary pressures and global economic meltdown followed by tough economic condition, persistent political instability and domestic gas shortages. Moreover, a higher working capital requirements and International Monetary Fund (IMF) coercion for increasing energy prices and jacking up export refinance rates will continue to pile pressure on textile exporters. Accordingly, based on World Bank's latest report forecast, Pakistan's real Gross Domestic Product (GDP) is to grow at 2.0% in the fiscal year 2022-23 (FY2023), while global growth is also expected to slow "perilously close" to recession in 2023, slashing its economic forecast on high inflation, rising interest rates and Russia's invasion of Ukraine.

02 ARTISTIC DENIM MILLS LIMITED

HALF YEARLY REPORT

DECEMBER 31, 2022

In order to keep the mills operational and maintain the export growth it is essential that the raw material must be available to the entire sector so that the sector which exports 80 percent of its products does not come to a standstill.

Notwithstanding, under the leadership of the Board, the Management of your Company remains cognizant of the challenges and would continue to make all efforts to ensure that adequate measures are taken to minimize the negative impacts on the Company. Curbing costs and maintaining high quality of product will remain the focus of your Company. However, with rising cost pressures, maintaining market share as well as ensuring reasonable margins will be a challenge.

ACKNOWLEDGEMENTS

We would like to extend our appreciation to the Company's suppliers, customers, financial institutions and partners for their continued confidence and support in the achievement of the Company's results. The Board of Directors take this opportunity to thank all the employees for their devotion, untiring work, dedication and commitment.

On behalf of the BOARD of DIRECTORS

MUHAMMAD FAISAL AHMED	YAZDANI ZIA
CHIEF EXECUTIVE	DIRECTOR
Karachi: February 11, 2023

ARTISTIC DENIM MILLS LIMITED 03